A Site Selection Web Exclusive,
August 2010

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Getting Off the Dime

As part of FutureGen 2.0, Ameren’s Meredosia power plant will see one of its units repowered with oxy-combustion technology.

photo courtesy of Ameren

An abrupt shift by the DOE signals a new site selection process now under way for what was once a forward-thinking project.

by ADAM BRUNS

H

as it really been five years already since the clean-coal combustion, carbon capture and sequestration dream known as FutureGen was announced? "Yes … yes it has," its weary supporters might reply.

First it was the derby for initial site selection, with Illinois beating out Texas in the end. Then, in 2008, the lame duck Bush administration pulled funding. But it stayed alive and gathered steam again, even garnering new momentum earlier this year when a family of corporate sponsors signed on. A 400-acre (162-hectare) site was purchased for $7 million by the FutureGen Alliance in the east-central Illinois town of Mattoon.

But now, just a few weeks from the fifth anniversary of the project's announcement, the U.S. Department of Energy is in the midst of a brand new site selection for what it's calling FutureGen 2.0 … and as a result Mattoon has taken its ball and gone home.

The agency on August 5 announced that its clean coal power program had selected Ameren Energy Resources Company, LLC (AER) – the holding company for merchant generation for Ameren Corp.; Babcock & Wilcox Co.; and Air Liquide Process & Construction, Inc. to negotiate the installation of the world's first full-scale oxy-coal-fired power plant that includes permanent carbon dioxide (CO2) capture and storage (CCS). Some $1 billion in proposed Recovery Act funding for the $1.2-billion project would supplement the construction and operating costs of a 200-megawatt, near-zero emissions generating facility to be located at Ameren's merchant generation Meredosia Plant near Jacksonville in west-central Illinois, some 170 miles (274 km.) west of Mattoon, as well as a CO2 pipeline network.

"Today's announcement will help ensure the U.S. remains competitive in a carbon constrained economy, creating jobs while reducing greenhouse gas pollution," said DOE Secretary Steven Chu. "This investment in the world's first, commercial-scale, oxy-combustion power plant will help to open up the over $300-billion market for coal unit repowering and position the country as a leader in an important part of the global clean energy economy."

The project partners estimate the program will bring 900 jobs to downstate Illinois and another 1,000 to suppliers across the state. The DOE said it would allow 50 people to be rehired at the Ameren plant. But Ameren spokesperson Susan Gallagher clarifies the matter: "The 50 jobs mentioned in the DOE release are not recalled jobs but job opportunities." The company did eliminate 47 positions at the plant in 2009, when units 1 and 2 at the plant were retired. But "many of those were through attrition, retirement and severance and not recallable," she says. In fact, just 19 of those 47 may return.

If the project is accepted and regulatory approvals are received, the next steps would be the negotiation of a cooperative agreement with DOE, followed by a six-month initial design process and analysis of costs. Meanwhile Meredosia's units 3 and 4 continue to operate: unit 3 (229 MW) on pulverized coal and the 200-MW unit 4 (the one to be repowered) on fuel oil.

Though it was not part of the original FutureGen team in 2005, St. Louis-based Ameren has been pursuing its own emissions research. It's part of the Midwest Geological Sequestration Consortium and the consortium for Clean Coal Technology at Washington University. It's funded large-scale CCS tests on pulverized coal plants. And it's joined other Missouri utilities in the Missouri Carbon Sequestration Research Project to test carbon storage over a 1,500-acre (607-hectare) site in Springfield, Mo., in that state's southwest corner.

The Shift Is On

The oxy-coal combustion process developed by B&W and Air Liquide uses pure oxygen for the burning of coal, resulting in exhaust gas that is highly concentrated carbon dioxide ready for long-term storage.

But where to store it? In version 2.0, suddenly Mattoon's role was reduced to glorified storage only — no demonstration project, no multiple above-ground facilities with which to generate an economic development cluster. So Coles County officials pulled the plug on their involvement, even after all the time and expense that had been devoted to proving the storage site's viability.

Since July 2008, Dr. William W. Shilts has served as executive director of the Institute of Natural Resource Sustainability at the University of Illinois-Champaign. For 13 years before that, he was director of the Illinois State Geological Survey (ISGS). Earlier this week he and the current ISGS director, Dr. E. Donald McKay III, offered their perspectives on FutureGens past and present.

Shilts says the DOE's shift came about for two main reasons. One is the existence of several commercial combined cycle gasification projects being pursued already by the commercial sector. "The second reason is that it's way too expensive," with estimates ballooning from the original $1-billion figure to nearly double that amount.

Doing oxy-combustion at Meredosia, by contrast, is about repowering within an existing shell, not building from scratch. McKay says the ultimate goal is to rebuild some 50 coal-fired plants, all feeding into a pipeline to a regional storage facility.

"We would be involved in the siting of the pipeline in some scenarios," he says of the ISGS's role. "In others, they're talking about siting along existing rights of way."

Shilts observes that the pipeline to Mattoon was initially left in FutureGen 2.0 because the coalition there had put so much effort and money into properly characterizing the site. "But that's a long pipeline, virtually all the way across Illinois," he says. Meantime, a few very basic questions have to be answered in Illinois, he says, because they'll come up everywhere else too.

"The liability issue is probably not a big issue," he says, though it had been solved in Mattoon when the state agreed to take on that responsibility. Then again, "there are lots of things in any large energy project that might have unforeseen geologic consequences" Other questions include "Who owns the pore space in the Mount Simon? Who will benefit from having the CO2 in this unit? One reason Mattoon was so valuable was a very complete environmental evaluation of that site had been done and approved. I suspect possibly commercial firms will take a look at that. I would be very surprised if the county development people don't' try to attract commercial firms to that site, which is already owned by the county."

Candidates Long to Fill Vacancy

"I am disappointed by the decision of community leaders in Mattoon and Coles County to forgo participation in the FutureGen 2.0 project, but as I said at the outset, I will abide by their decision," said Sen. Dick Durbin (D-Ill.) on August 11. "This week, I will ask the Department of Energy to solicit other Illinois communities to take on the role envisioned for Mattoon … I wish cost overruns, project delays and rapid advances in science in other parts of the country had not necessitated a change in the FutureGen project. But we must face reality."

Other towns are ready for a dose of that reality, including two that lie between Meredosia and Mattoon — state capital Springfield, and Decatur, where Archer Daniels Midland has been pursuing its own CCS project involving emissions from an ethanol plant it operates.

"ADM has partnered with the U.S. Department of Energy's National Energy Technology Laboratory and other important academic and corporate partners on two key projects to demonstrate carbon capture and sequestration as a viable option for reducing carbon dioxide emissions from manufacturing operations," says ADM spokesperson Beth Chandler in response to a query from Site Selection. "The first project, announced in January of 2008, will demonstrate the viability of sequestering carbon dioxide in the Mount Simon Sandstone, a large underground saline-bearing rock formation. Led by the Illinois State Geological Survey, this project will capture and sequester 1 million tons of carbon dioxide from ADM's ethanol facility in Decatur, Illinois, over a three-year period."

The second project, led by ADM with an investment of $43.6 million in addition to the federal grant, was announced in June 2010. This project is a full-scale commercial project designed to sequester and store 1 million tons of carbon dioxide annually, and is expected to conclude in the third quarter of 2015. Schlumberger Carbon Services is a partner, as is the DOE, which contributed a $99.2-million grant in June.

Asked if ADM might be interested in putting some of its CO2 into the FutureGen 2.0 pipeline, she says, "Though we are not currently an active participant in the FutureGen project, we are interested in the program's progress and will continue to monitor developments as the project proceeds." Shilts says cement plants might also be candidates for pumping emissions into storage.

On August 19, at a meeting in Chicago, officials from DOE, the State of Illinois, Ameren, B&W, Air Liquide and the FutureGen Alliance discussed next steps. "The project remains on track for obligation before the end of September," the DOE said, with the plan calling for beginning construction in 2012. "At the same time, following DOE best practices, a site selection process will be conducted to locate a site for the carbon sequestration research, repowering work-force training facility, visitor center, and long term CO2 repository."

"While we regret Coles County's decision not to participate in this first of its kind carbon capture and storage project, the Mount Simon geological formation extends over much of downstate Illinois and offers many other possible locations for storage. We are encouraged by the response we've received from interested communities so far and look forward to working with the project team as they select a new sequestration center over the coming months," said James Markowsky, the DOE's assistant secretary for fossil energy.

Communities that are interested in being considered as a storage site are encouraged to continue contacting the Department of Energy at futuregen2.0@hq.doe.gov. According to the DOE, "the eventual site will need strong geological characteristics, access to acreage pipeline right of ways and subsurface rights on 10 square miles [26 sq. km.] of contiguous acreage for sequestration, clear community support, and should be within approximately a 100-mile [160-km.] radius of Meredosia. Any town selected will benefit from jobs created not only for the injection and CO2 monitoring wells, but also from a planned research and visitor complex and work-force training center."

All In the Formation

It sounds like two site selection processes — one above ground and one below ground — that don't necessarily need to conclude in the same community. DOE was unable to respond to questions by press time, but William Shilts concurs.

"That's true," he says of the separate considerations, "but now that Mattoon is not in the running, we can look at the Meredosia site itself, rather than building a pipeline." DOE may be hoping the state will cover the cost of such a pipeline, he says, which, given the state's budget, "might be a pipe dream."

What isn't a pipe dream is the value of the pore space in the sandstone — literally the empty space between sand grains where the CO2 would reside.

When the DOE funded phase one of its sequestration program, it put together an atlas of possible reservoirs, which the U.S. Geological Survey currently is reviewing and expanding. McKay says there is a lot of reservoir volume in the U.S., but a large part of it is in restricted areas. "A large part of the U.S. doesn't have reservoirs," he says.

Shilts says the Mount Simon formation underlies a lot of the Midwest, but is particularly thick in the Illinois Basin, which he describes as "a casserole-shaped geological structure." The Mount Simon holds drinking water in the northern half of Illinois, but its depth in the central and southern parts is what gives it a carbon storage advantage.

"It's very deep, and there are many geologic units above it that would seal it from the surface environment. It's full of saltwater, so it's not a commodity that's likely to be used, and because it's full of water, we know it's very porous and can take the storage of carbon dioxide."

The formation is a proven commodity, as about 30 sites in the state already use it to store natural gas pumped in from Canada or Louisiana.

While stored CO2 can be used effectively for enhanced oil recovery, McKay says that use does not have a lot of potential in Illinois, though Shilts mentions discussions years ago about piping the CO2 down to oilfields in Louisiana and West Texas.

McKay points out that once Illinois has proved itself and become a sequestration-ready state, the long-term viability will depend on how cap and trade legislation and funding formulas work out, as well as on some system for putting the carbon dioxide into pipe. "That doesn't exist yet."

What does exist is community familiarity with the concept, which McKay says was a major reason DOE established seven regional partnerships throughout the U.S. as it undertook its carbon sequestration pilot program. "The important part of that was that it built a local populace that was exposed to it, became somewhat familiar with it, and developed some acceptance of it," he says. "Two or three of those partnerships aren't doing very well. Ours is healthy at this point. Public perception is an important factor here — it can kill a project if it goes sour."

Ultimately, says Shilts, "The real potential of FutureGen from the beginning for Illinois is that by getting these large companies involved in these pilot projects, they're going to develop expertise that can be exported all over the world. We've had a lot of interest from groups from China for instance, who have come to see the ADM example — another delegation is coming in the fall. I see that as one of the major advantages for Illinois investing in this type of research. Train people in the state who can take that training and bring back revenue to the state from applying these techniques elsewhere."

Though he's a career geologist, Shilts says, "Until this whole question of carbon sequestration came up, I never really thought of the state's geology and structure of rocks as a major natural resource."

For that matter, it could become a national resource. But first, FutureGen must actually occur. It's been five years now. Without being put into practice, some concepts have a way of turning into porous relics.

Story in Pictures

Sen. Dick Durbin (D-Ill.), met Aug. 5 with U.S. Secretary of Energy Steven Chu to discuss his decision to move forward with FutureGen 2.0 in Illinois.

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